Bethlehem Steel Export Corp. v. Redondo Const. Corp.
| Citation | 140 F.3d 319 |
| Decision Date | 01 December 1997 |
| Docket Number | No. 97-1738,97-1738 |
| Parties | BETHLEHEM STEEL EXPORT CORPORATION, Plaintiff, Appellant, v. REDONDO CONSTRUCTION CORP., et al., Defendants, Appellees. . Heard |
| Court | United States Courts of Appeals. United States Court of Appeals (1st Circuit) |
Page 319
v.
REDONDO CONSTRUCTION CORP., et al., Defendants, Appellees.
First Circuit.
Decided April 3, 1998.
Juan A. Ramos-Daz, San Juan, PR, for appellant.
Javier A. Morales-Ramos, San Juan, PR, for appellee American International Insurance Company of Puerto Rico.
Stuart A. Weinstein-Bacal, with whom David C. Indiano and Indiano, Williams & Weinstein-Bacal, San Juan, PR, were on brief, for appellee Redondo Construction Corp.
Before TORRUELLA, Chief Judge, BOWNES, Senior Circuit Judge, and STAHL, Circuit Judge.
TORRUELLA, Chief Judge.
Plaintiff Bethlehem Steel Export Corporation ("Bethlehem") seeks to recover on a construction payment bond executed by defendants Redondo Construction Corporation ("Redondo") and its surety, American International Insurance Company of Puerto Rico ("American International"), pursuant to Law 388, P.R. Laws Ann. tit. 22, § 47 et seq., which requires every public works contractor to post a bond to secure the payment of materials used by the general contractor and subcontractors.
Redondo, the principal contractor for the construction of a portion of the Expreso de Diego, P.R. Highway 22, between Barceloneta and Manat ("Expreso de Diego"), Puerto Rico, paid Transcontinental Steel Company ("Transco") in full for steel Transco had acquired from Bethlehem. On defendants' renewed motion for summary judgment, the district court found that Transco was not a subcontractor, but rather a mere material supplier to Redondo during the construction of the Expreso de Diego. Accordingly, the district court determined that Bethlehem was not entitled to protection under Law 388 for
Page 320
certain materials supplied to Transco. We affirm.I. BACKGROUND
In October 1990, Redondo entered into a written contract with the Puerto Rico Highway Authority for the construction of the Expreso de Diego. Redondo and its bonding company, American International, executed and delivered to the Highway Authority a construction payment bond pursuant to Law 388, which was modeled after the Miller Act, 40 U.S.C. § 270, et seq. Thereafter, Transco supplied Redondo with the structural steel required for the construction project. Redondo paid Transco in full for the steel. Transco had originally acquired the fabricated steel from Bethlehem, but it went bankrupt and failed to pay Bethlehem for the steel. Bethlehem seeks payment for the steel under the bond executed by Redondo and American International in accordance with Law 388. The primary issue on appeal is whether Transco was a subcontractor of Redondo, thus entitling Bethlehem to the protection of Law 388, or simply a material supplier to Redondo, which would leave...
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